Malta and the Euro

While Maltese is the national language on Malta, English is widely used and also an official language for the tiny island nation and former British colony. Many students from other European countries, especially Spain and France, travel to Malta to improve their English during the summer holidays. They also happen to be one of the biggest sources of income to the nation.

But, before they begin their standard two-week language classes, they have to exchange their money from euros to Maltese lira. Many tourists find it aggravating, especially after having become accustomed to traveling throughout Europe using the euro.

Gillian de Gaetano, who runs one of the language schools on the island, said she is overjoyed about the introduction of the euro in January. It will save her a great deal of paperwork, and a lot of money, such as the exchange fees she must pay when parents transfer euros for their kids' language course fees.

Once the euro is introduced, de Gaetano said she also hopes to be able to sell more leisure activity packages to tourists.

Tourism is a huge source of income

Tourism is the most important economic branch on the island with Britons and Germans composing the largest groups in a total of over million tourists each year. Tourists' tastes are also becoming more refined. Malta is increasingly becoming a stop for luxury cruise liners, and more and more high-class hotels are cropping up across the island.

Both tourists and natives can already become accustomed to the euro on the island. Since June of this year, prices of goods must be listed in both lira and euros.

With Malta located only 120 kilometers (74.5 miles) from Sicily, the people on the island could observe how Italian business owners used the switch to the euro in 2002 to jack up the prices of their products.

But Maltese business owners now want to reassure island inhabitants that the same won't happen on their island.

In the capital Valletta's busy Republic Street, shops windows display blue and green signs marked with the word "fair" -- meaning that prices are not supposed to increase when the currency changes.

Hopes for an economic boost

In addition to the tourism industry, trade is also important for the island. Peter Darley, managing director of VGT, the largest shipping company at Grand Harbour in Valletta, said that the euro will not change his business much.

However, he does anticipate that prices of everyday goods will increase.

"The government is trying to control that," Darley said. "In the long term, the euro will be good for Malta."

Like Darley, many of the Maltese people hope joining the euro zone will stimulate their economy.

They envision profiting from the switch since, right now, they earn only around one-fifth of what average EU citizens do each year.